GBP/USD holds in the positive territory above 1.3900 after dismal US data
- GBP/USD clings to small daily gains on Wednesday.
- Private sector employment in US rose less than expected in July.
- US Dollar Index stays near 92.00 ahead of US ISM data.
The GBP/USD pair continues to trade in a relatively tight range on Wednesday but manages to stay in the positive territory. As of writing, the pair was up 0.18% on the day at 1.3939.
USD struggles to find demand after ADP data
The data published by the Automatic Data Processing (ADP) Research Institute showed on Wednesday that employment in the US private sector rose by 330,000 in July. This reading missed the market expectation of 695,000 by a wide margin and made it difficult for the greenback to gather strength. At the moment, the US Dollar Index is posting small daily gains at 91.98.
Later in the session, the IHS Markit's and the ISM's Services PMI reports from the US will be looked upon for fresh impetus. However, ahead of the Bank of England's (BoE) monetary policy announcements on Thursday, GBP/USD's reaction is likely to remain muted.
Previewing the BoE event, "there are good reasons for the BOE to convey a cautious message on its August Super Thursday," said FXStreet analyst Yohay Elam. "That would weigh on GBP/USD but probably not for too long."
Bank of England Preview: Five reasons the doves are set to win Super Thursday, GBP/USD may dip.
Technical levels to watch for